Australia’s Labor government has proposed replacing the country’s long-standing capital gains tax discount with an inflation-indexed model that could raise tax liabilities for crypto investors holding assets over extended periods.

The Australian Financial Review reported on Sunday, citing people familiar with the fiscal year 2027 budget, that the Albanese government plans to remove the current 50% capital gains tax discount as part of a wider package of tax changes tied to investment and housing policy. Under the existing system, Australians who hold assets for more than 12 months can reduce taxable capital gains by half.

Instead of the discount model, the proposed framework would tax inflation-adjusted real gains across the full holding period of an asset. Long-term investors with modest inflation-adjusted returns could end up paying more tax, particularly higher-income earners with exposure to shares, crypto, and commercial assets.

Changes outlined in the federal budget are expected to take effect from July 2027, according to the AFR report. Assets purchased after May 10 would receive a one-year transition arrangement before the new rules fully apply. Investments acquired before that date would retain partial access to the current discount system, with tax treatment calculated proportionally based on how long the asset was held under each regime.

Criticism from market participants surfaced shortly after details of the proposal emerged. Chris Joye, portfolio manager at Coolabah Capital Investments, argued that the changes would discourage investment across productive sectors of the economy.

“After the budget doubles the capital gains tax on productive businesses and assets from about 23.5% to 46-47%, investors will understandably pull money from businesses, shares, commercial property and rental housing and plough it into their tax-free owner-occupied home,” Joye said.

Joye added that owner-occupied housing would become “the single biggest winner from the budget” because investors would redirect capital toward tax-advantaged property instead of business or market investments.

Scott Phillips, chief investment officer at investment advice firm The Motley Fool, took a different view. In comments posted on X, Phillips said investors affected by the changes would still have strong incentives to pursue long-term growth opportunities because profitable investments would continue generating substantial returns even with higher tax obligations.

The proposed tax overhaul arrives as Australian policymakers continue shaping rules around digital assets and tokenized finance. In April, a draft payments vision co-developed by the Account-to-Account Payments Roundtable identified stablecoins and tokenized liabilities as technologies moving “from experimentation to adoption.”

Members of the roundtable include AusPayNet, Australian Payments Plus, the Reserve Bank of Australia, and the Commonwealth Treasury. The draft stated that account-to-account payment infrastructure may eventually need to support interoperability between traditional bank money and tokenized fiat representations.

U.S. Federal Reserve changes, inflation data and earnings dominate the week’s calendar, with markets weighing bitcoin’s BTC$80,814.36 newfound strength against a packed macro slate.

“The market is entering a phase where liquidity is becoming more selective rather than purely speculative,” Jake Seltzer, CEO of Quantix Finance, told CoinDesk in an emailed statement. “Bitcoin continuing to strengthen at these levels is important because it’s reinforcing confidence across the broader digital asset market, particularly among institutional allocators that were previously sitting on the sidelines.”

This week will see inflation data coupled with earnings from many crypto companies.

“Near term, markets will still be driven by macro conditions, ETF flows, and global liquidity, so volatility is expected,” Seltzer said. “But structurally, the industry feels much healthier than previous cycles.”

Seltzer said capital is starting to favor “real infrastructure, sustainable yield models, and platforms with actual risk management behind them rather than short-term narratives alone.”

That shift will also put infrastructure in focus. Azul, an upgrade for the Base blockchain, is expected to go live on mainnet, Ronin is set to move back to Ethereum, and several DAOs are voting on treasury, recovery and MEV-related proposals as the ecosystem recovers from the largest exploit of the year to date.

What to Watch

(All times ET)

• Crypto
  • May 11: U.S. Senate expected to hold a procedural vote on Kevin Warsh’s Federal Reserve nomination package.
  • May 13: Base Azul expected to go live on mainnet.
  • May 14: U.S. Senate Banking Committee markup scheduled for the Digital Asset Market Clarity Act of 2025.
  • May 15: Jerome Powell’s term as Federal Reserve Chair officially ends; his board term continues until Jan. 31, 2028.
• Macro
  • May 12, 01:00 a.m.: Germany Inflation Rate Final for April YoY est. 2.9% (Prev. 2.8%); MoM est. 0.5% (Prev. 1.2%)
  • May 12, 05:30 a.m.: India Inflation Rate YoY for April est. 3.8% (Prev. 3.4%); MoM (Prev. 0.26%)
  • May 12, 07:30 a.m.: U.S. Core CPI MoM for April est. 0.4% (Prev. 0.2%); YoY (Prev. 2.6%)
  • May 12, 07:30 a.m.: U.S. CPI MoM for April est. 0.6% (Prev. 0.9%); YoY (Prev. 3.3%)
  • May 13, 07:30 a.m.: U.S. PPI MoM for April est. 0.4% (Prev. 0.5%); YoY (Prev. 4.0%)
  • May 13, 07:30 a.m.: U.S. Core PPI MoM for April (Prev. 0.1%); YoY (Prev. 3.8%)
  • May 14, 01:00 a.m.: U.K. GDP Growth Rate Q1 Prel. QoQ (Prev. 0.1%); YoY (Prev. 1.0%)
  • May 14, 07:30 a.m.: U.S. Retail Sales MoM for April (Prev. 1.7%)
  • May 14, 07:30 a.m.: U.S. Initial Jobless Claims for period ending May 9 (Prev. 200K)
  • (Prev. 11)
  • May 15, 08:15 a.m.: U.S. Industrial Production MoM for April (Prev. -0.5%)
  • May 17, 09:00 p.m.: China Industrial Production YoY for April (Prev. 5.7%); Retail Sales YoY (Prev. 1.7%); Fixed Asset Investment YTD YoY (Prev. 1.7%); Unemployment Rate (Prev. 5.4%)
• Earnings (Estimates based on FactSet data where available)
  • May 11: MARA Holdings (MARA), post-market, –$0.45
  • May 11: CleanSpark (CLSK), post-market, -$0.23
  • May 11: Circle Internet Group (CRCL), pre-market, $0.17
  • May 11: Exodus Movement (EXOD), post-market, $0.01
  • May 11: Bakkt (BKKT), post-market, -$0.10
  • May 11: Sharplink (SBT), pre-market, $0.01
  • May 12: EToro Group (ETOR), pre-market, $0.69
  • May 12: Coincheck Group (CNCK), post-market, -$0.01
  • May 12: TON Strategy Company (TONX), pre-market, -$1.42
  • May 13: Bitgo Holdings (BTGO), post-market, -$0.01
  • May 14: Bullish (BLSH), pre-market, $0.16
  • May 14: Rumble (RUM), post-market, -$0.09
  • May 14: Gemini Space Station (GEMI), post-market, -$1.13
  • May 14: Bitdeer Technologies (BTDR), pre-market, -$0.33
  • May 14: Applied Materials (AMAT), post-market, $2.66

Token Events

• Governance votes & calls
  • 1inch DAO is voting to allocate $155,000 USDC for its 2026 public policy and regulatory advocacy program, funding trade group memberships and direct U.S. lawmaker engagement. Voting ends May 11.
  • Compound DAO is voting to contribute about 1,860 ETH to the DeFi United rsETH recovery effort. The funds will be sourced exclusively from the attacker’s recovered position on Compound rather than the broader treasury, ensuring the DAO does not profit from the exploit. Voting ends May 11.
  • Balancer DAO is voting to distribute a one-time 500,000 USDC airdrop to veBAL holders as compensation for discontinued incentives, replacing a planned six-month payout. Voting ends May 12.
  • GnosisDAO is voting to let holders burn GNO for a pro-rata share of the treasury’s liquid assets and a synthetic claim token for illiquid investments. Voting ends May 12.
  • QuickSwap DAO is voting to integrate the MEV-X Homelander plugin to capture backrunning MEV from its liquidity pools and redistribute the profits back to the protocol and its liquidity providers. Voting ends May 12.
  • ShapeShift DAO is voting to formalize its Treasury Signer role as a paid position of $1,000 per month in FOX and update the selection committee’s rules for appointing signers privately. Voting ends May 13.
  • Decentraland DAO is voting to remove the peer.kyllian.me catalyst node following its owner’s removal from the Security Advisory Board. Voting ends May 14.
• Unlocks
  • May 12: Avalanche (AVAX) to unlock 0.31% of its circulating supply worth $16.55 million.
  • May 15: Connex (CONX) to unlock 1.49% of its circulating supply worth $17.99 million.
  • May 16: Arbitrum (ARB) to unlock 1.71% of its circulating supply worth $13.23 million.
• Token Launches
  • May 11–17: First full week of Pump.fun’s revised tokenomics.
  • May 12: Ronin officially moves back to Ethereum.

Conferences

Cryptocurrency staking has become one of the most popular ways for investors to earn passive income in the digital asset market. Many blockchains now encourage users to “stake” their coins in exchange for rewards, often advertising attractive annual returns that appear far higher than traditional savings accounts.

But beneath the promise of passive earnings lies a more technical system involving validators, network security, lock-up periods, and risk management. Understanding how staking actually works is essential before committing funds to any blockchain protocol.

This article breaks down the fundamentals of crypto staking simply and practically.

What Is Crypto Staking?

Crypto staking is the process of locking cryptocurrency into a blockchain network to help support its operations. In return, participants receive rewards from the network.

Staking is commonly associated with blockchains that use a mechanism called Proof of Stake (PoS).

Unlike Bitcoin’s Proof of Work system, where miners use computing power to validate transactions, Proof of Stake networks rely on users who commit coins to the network. These users help verify transactions and maintain blockchain security.

Popular staking networks include:

• Ethereum
• Solana
• Cardano
• Avalanche
• Polkadot

When you stake crypto, you are essentially helping the blockchain remain decentralized and operational.

The Role of Validators

Validators are the backbone of Proof of Stake blockchains.

A validator is responsible for:

• Confirming transactions
• Producing new blocks
• Securing the network
• Preventing fraudulent activity

To become a validator, users usually need to stake a significant amount of cryptocurrency. For example, Ethereum validators require 32 ETH to operate independently.

Because running a validator can be technically demanding, many users instead delegate their tokens to professional validators through staking platforms or wallets.

Here is the simplified process:

1. You stake your tokens
2. Your tokens are delegated to a validator
3. The validator participates in securing the network
4. Rewards are distributed among participants

The more stake a validator controls, the greater the chance they are selected to validate transactions and earn rewards.

Where Do Staking Rewards Come From?

Many beginners assume staking rewards are “free money.” In reality, rewards come from several blockchain mechanisms.

These usually include:

1. Newly Issued Tokens

Some blockchains create new coins over time to incentivize validators and stakers.

This works similarly to how central banks issue currency, except blockchain issuance follows programmed rules.

2. Transaction Fees

Users pay transaction fees whenever they interact with the blockchain.

Part of those fees may be distributed to validators and delegators.

3. Network Incentives

Certain protocols offer additional incentives to encourage participation during early growth stages.

This is why newer projects sometimes advertise unusually high staking returns.

Understanding Lock-Up Periods

One of the most misunderstood aspects of staking is liquidity restriction.

When you stake crypto, your assets are often locked for a certain period of time.

This means:

• You may not be able to sell immediately
• You may need to wait days or weeks to unstake
• Market volatility can affect your holdings during the lock-up

For example:

• Some networks allow flexible staking with instant withdrawals
• Others impose “bonding” periods ranging from several days to several weeks

This matters because crypto markets move quickly. A token’s price can rise or collapse while your funds remain locked.

Investors should always check:

• Unstaking periods
• Withdrawal delays
• Early exit penalties
• Liquidity conditions

before committing funds.

The Main Risks of Staking

Staking is often promoted as low-risk passive income, but it still carries significant risks.

1. Price Volatility

The largest risk is often not staking itself, but the cryptocurrency’s price movement.

Example:

• You earn 8% annual staking rewards
• But the token loses 40% of its market value

In that case, the staking yield does not offset the capital loss.

2. Validator Failure

If a validator behaves maliciously or experiences downtime, penalties may occur.

This process is known as slashing.

Slashing can reduce the validator’s stake — and potentially affect delegated users as well.

3. Smart Contract Risks

Some staking platforms rely on smart contracts.

If vulnerabilities exist, funds could be exploited or lost.

This is particularly important in decentralized finance (DeFi) ecosystems.

4. Centralization Risks

Large staking providers can accumulate excessive control over networks.

If too much stake becomes concentrated among a few entities, blockchain decentralization weakens.

5. Liquidity Risk

Locked funds may prevent investors from reacting to sudden market conditions.

This becomes especially dangerous during major market crashes.

The Truth About APR and APY

One of the biggest misconceptions in crypto staking involves advertised returns.

You will often see platforms promoting:

• 15% APR
• 40% APY
• Even triple-digit yields

These numbers can be misleading.

APR vs APY

• APR (Annual Percentage Rate) = simple yearly return without compounding
• APY (Annual Percentage Yield) = includes compounding rewards

Higher APY figures often assume rewards are continuously restaked.

Why High APR Does Not Always Mean High Profit

A high-stakes APR does not guarantee real gains.

Several factors can reduce profitability:

• Token inflation
• Falling token prices
• Reward dilution
• Temporary promotional incentives

For example:

A project may offer 80% staking rewards, but if the token loses 85% of its value, stakers still lose money overall.

This is why experienced investors evaluate:

• Token fundamentals
• Network adoption
• Inflation rate
• Validator quality
• Long-term sustainability

Instead of focusing only on reward percentages.

Is Staking Safe?

Staking is generally considered safer than speculative trading, but it is not risk-free.

The safety of staking depends on:

• The quality of the blockchain
• Validator reliability
• Platform security
• Market conditions
• Smart contract design

Major established networks tend to carry lower operational risk than smaller experimental projects.

However, even reputable ecosystems can experience technical failures, governance issues, or severe price declines.

Liquid Staking: A Growing Trend

To solve liquidity problems, many platforms now offer liquid staking.

Liquid staking allows users to:

• Stake assets
• Continue earning rewards
• Receive a tokenized representation of their staked assets

These tokenized assets can sometimes be traded or used in DeFi applications while the original funds remain staked.

Although convenient, liquid staking introduces additional smart contract and counterparty risks.

Final Thoughts

Crypto staking plays a critical role in modern blockchain networks. It helps secure decentralized systems while allowing users to earn rewards for participation.

However, staking is far more complex than simply “locking coins for passive income.”

Validators maintain network integrity, rewards are tied to economic incentives, lock-up periods affect liquidity, and high APR figures can sometimes create unrealistic expectations.

For beginners, the most important lesson is this:

Staking rewards should never be evaluated in isolation. The long-term value of the underlying asset, the security of the network, and the sustainability of the reward model matter far more than headline percentages.

As Proof of Stake ecosystems continue expanding, staking will likely remain a central pillar of the cryptocurrency economy — but informed participation will always be more important than chasing the highest yield.

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Privacy proponents have criticized Google’s latest updates to its reCAPTCHA system, arguing it has effectively “locked out” millions of websites from Android users running privacy–focused operating systems. 

Google-owned reCAPTCHA is used to verify whether a user is a person, usually by asking them to click on images of a bus or a fire hydrant. 

Google announced “Cloud Fraud Defense” in late April, branding it “the next evolution of reCAPTCHA.”The latest update now presents users with a QR code to verify their humanity, but requires Google Play Services or the Apple equivalent to be running on the device, which isn’t present on “de-Googled” Android phones, such as those running GrapheneOS or CalyxOS.

“They’re directly participating in locking out competition via their own services,” said the GrapheneOS team on Sunday, referring to the increasing use of Apple’s App Attest and Google’s Play Integrity. 

“Requiring people to have an Apple device or Google-certified Android device is anti-competition, not security.”

Privacy advocates often use de-Googled mobile operating systems to prevent data harvesting by Google software and have more freedom over what can be installed on their devices.

Backlash as changes impact privacy-focused users 

“Privacy-conscious internet users are being demoted from 2nd to 3rd class netizens,” said Bitcoin security researcher and cypherpunk Jameson Lopp on Sunday. 

“Google now treats privacy as suspicious behavior by default,” cybersecurity outlet International Cyber Digest said. 

The CEO and co-founder of the privacy-focused Brave browser, Brendan Eich, said services shouldn’t ban people from using arbitrary hardware and operating systems in the first place. 

“Google’s security excuse is clearly bogus when they permit devices with no patches for ten years… It’s for enforcing their monopolies via GMS licensing, that’s all.”

Source: Jameson Lopp

Desktop browsers initially targeted

To complete mobile verification, one must use a compatible mobile device that includes Google Play Services version 25.41.30 or greater or iOS version 15.0 or greater, states Google on its website. 

The team at GrapheneOS explained that the move would impact Microsoft Windows or other operating systems not certified by Google or Apple. The prompt is primarily going to be shown on desktop platforms, but could be expanded, it said.

“Their plan requires having a certified Android device or iOS device to pass this on a desktop,” they added. 

Related: Google Chrome’s 4GB AI model shows why browser trust matters for crypto security

“Control over reCAPTCHA puts Google in a position where they can require having either iOS or a certified Android device to use an enormous amount of the web.”

Google engineers spearheaded a controversial proposal in 2023

Google attempted something similar in 2023 with a system called “Web Environment Integrity (WEI),” which would have let the company decide which devices were “real enough” to access the web, wrote International Cyber Digest.

“Standards bodies and the public pushed back hard, and Google killed it. Three years later, the same idea is back, just hidden behind a QR code instead of a browser feature,” they added. 

Magazine: Strategy reveals why they would sell BTC, Trump Media posts loss: Hodler’s Digest

The team behind the Renegade.fi protocol said a whitehat hacker returned about $190,000 after exploiting one of its Arbitrum-based decentralized dark pools and later complying with instructions in an onchain message to return 90% of the funds.

Renegade confirmed the return of funds on Sunday after blockchain analytics platform Blockaid flagged the $209,000 exploit at 8:27 am UTC. The hacker injected malicious logic into a faulty function tied to its V1 Arbitrum dark pool to steal 27 ERC-20 tokens.

Data from Arbitrum block explorer Arbiscan shows that the whitehat returned about $190,000 to the Arbitrum wallet address “0xE4A…5CFBE,” which includes $84,370 worth of USDC (USDC), $27,885 in wrapped Bitcoin and $23,950 in wrapped Ether.

Source: Renegade

Whitehat hackers have come to play a crucial role in the fight against bad actors who continue to exploit crypto protocols despite strengthened security measures in recent years. 

Industry initiatives like the crypto security nonprofit Security Alliance’s Safe Harbor framework have been set up to enable white hats to steal funds for temporary safekeeping while being legally protected.

In an onchain message, Renegade asked the hacker to return 90% of the funds and keep the remaining 10% as a “whitehat bounty” to avoid facing potential “civil or criminal action.”

The onchain message that Renegade sent to the hacker. Source: Arbiscan

The whitehat hacker sent more than 90% of the stolen funds back within 45 minutes and said in response to the onchain message that the action was taken to protect DeFi users: 

“I’ve seen a lot of contempt toward my actions. Although I understand that what I did was not ethical, in the current DeFi cybersecurity, I believe this was the best solution to protect users’ funds and ensure their safety.”

The whitehat hacker also hinted that Renegade should tighten up its security measures, stating that the vulnerability exploited was “tooooo simple and bad.”

Related: Crypto hackers stole $17B over past 10 years: DefiLlama 

North Korean state-backed hackers “would never come to negotiate,” they added.

Renegade said the exploit appeared to have resulted from the deployment code failing to assign an explicit owner and from a faulty migration in an April 2025 software update, enabling anyone to rewrite the smart contract tied to its V1 Arbitrum dark pool.

Dark pools are private trading platforms that allow large trades to occur without exposing their intentions to, or impacting, the broader market. 

Renegade added that it would publish a post-mortem with a “full root-cause analysis” explaining the security incident.

Renegade said it would fully compensate affected users, and that only 7% of its trading volume was channeled through the V1 Arbitrum dark pool and that it would contact the “small number of affected users directly.”

Magazine: AI-driven hacks could kill DeFi — unless projects act now

Key Takeaways

• Michael Saylor shared “Back to work, BTC” on X on May 10, indicating an upcoming Bitcoin acquisition
• The company suspended its Bitcoin purchases for one week surrounding its May 5 Q1 2026 earnings report
• During Q1 earnings, Saylor revealed Strategy might occasionally liquidate minor BTC amounts for dividend funding — marking a departure from its historical hold-forever policy
• The firm’s Bitcoin treasury contains 818,334 BTC purchased at an average price of $75,537, valued at roughly $66.15 billion today
• CEO Phong Le emphasized any BTC sales would be minimal and inconsequential to market dynamics, noting Bitcoin’s daily trading volume exceeds $60B

Michael Saylor of Strategy seems poised to resume Bitcoin acquisitions. On May 10, he shared “Back to work, BTC” on X, accompanied by the company’s recognizable “Orange Dots” visualization — a post style that has consistently foreshadowed purchase announcements.

Historical patterns suggest an official acquisition announcement could arrive as soon as May 11.

The company’s buying hiatus spanned one week, strategically positioned around Strategy’s May 5 Q1 2026 earnings announcement. That particular earnings call generated considerable discussion.

Saylor stated during the presentation that Strategy would “probably sell some Bitcoin to fund a dividend, just to inoculate the market.” This marked a significant shift from the firm’s established never-sell Bitcoin philosophy.

Before this pause, Strategy’s latest acquisition occurred on April 27, purchasing 3,273 BTC for approximately $255 million at $77,906 per coin. This transaction elevated total holdings to 818,334 BTC.

Strategy Inc, MSTR

Currently, Strategy’s Bitcoin holdings are valued at around $66.15 billion, with an average acquisition cost of $75,537 per BTC — representing approximately a 7.6% gain on the position.

Divided Opinions Within the Bitcoin Community

The dividend-funding sale strategy generated varied responses across the Bitcoin community. Strategy shareholder Adam Livingston contended that strategic periodic sales would benefit the treasury over time, providing capital for additional BTC acquisitions.

Bitcoin proponent Samson Mow noted that maintaining the option to sell provides Strategy with enhanced flexibility in capital markets.

However, critics voiced stronger concerns. Some community members warned the approach could trigger a “doom loop,” where selling BTC to fund credit instrument dividends creates downward pressure on Bitcoin’s spot price.

CEO Phong Le rejected this characterization. He informed CNBC that Strategy’s trading activity doesn’t significantly influence Bitcoin’s market price.

Leadership Dismisses Market Impact Concerns

Le highlighted that Bitcoin experiences over $60 billion in daily trading activity. Strategy’s annual dividend commitments related to credit products amount to approximately $1.5 billion — representing just a small fraction of daily volume.

“I don’t think we’re driving the price up or down,” Le stated.

He further specified that Bitcoin sales would only occur under particular circumstances: satisfying dividend obligations and managing tax deferrals.

Strategy generated approximately $82 million through an MSTR at-the-market equity offering prior to the earnings-related pause. While that amount could have funded roughly 1,000 BTC at prevailing prices, the company refrained from making any purchase.

The April 27 acquisition — involving 3,273 BTC — represented a considerable deceleration from the $2.54 billion purchase executed on April 20. Strategy had been aggressively accumulating Bitcoin throughout April, and market observers had already detected the slowdown before the formal pause.

Strategy currently controls approximately 4% of Bitcoin’s circulating supply.